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The anticipated return of Binance founder Changpeng ZHAO to the limelight after his surprise release this Friday, September 27, 2024 has rocked the crypto market. After serving a prison sentence for violating the regulations, CZ was released two days ahead of schedule, which immediately affected the prices of Bitcoin and BNB. The release comes as Binance, the world’s number one crypto exchange, struggles to recover from sanctions imposed by US authorities.
Bitcoin and BNB play yo-yo
On September 27, 2024, Changpeng ZHAO, the founder and former CEO of Binance, was released after serving a four-month prison sentence. This release had a direct impact on the crypto market. Bitcoin price saw a small drop shortly after the announcement. After hitting highs during the day, the crypto fell in the face of uncertainty caused by the news. Similarly, BNB, Binance’s native crypto, saw its price drop. This immediate market reaction is explained by questions about Binance’s future and CZ’s future involvement as Binance tries to reinvent itself after a series of regulatory lawsuits.
However, this decline was short-lived. A few hours after its release, CZ published its first tweet, and this simple communication was enough to revive the markets. Bitcoin and BNB saw a 3% rebound. Despite his conviction and exclusion from the day-to-day affairs of Binance, CZ remains a key figure whose actions continue to affect players’ confidence in the crypto ecosystem.
CZ release: a new era for Binance?
Although the release of CZ attracted attention, it does not mean a return to the head of Binance. Since his conviction, Binance has made deep structural reforms to shed the controversial image that CZ left behind. Richard TENG, a former regulator in Abu Dhabi, took over. Binance has implemented a strengthened governance model focused on compliance. In particular, TENG claimed that the company has focused on a more transparent and centralized approach, a transition described as “Binance 2.0”. This new organizational structure aims to meet the demands of regulators, particularly the Department of Justice, which as part of the settlement imposed strict oversight of Binance’s activities for three years.
Although CZ no longer plays an active role in day-to-day management, its influence is still significant. As the majority shareholder, holding 90% of the stock exchange, it remains a key player. However, this release would represent a new chapter for CZ with initiatives outside of Binance, such as the Giggle Academy, an educational project aimed at underprivileged populations. However, the challenges for Binance do not end there. The company still faces lawsuits from the Securities and Exchange Commission (SEC) that could affect its ability to maintain its dominant market position.
The release of Changpeng ZHAO represents a pivotal moment for the future of Binance and more generally for the entire crypto market. If Binance has been able to evolve without its founder at the helm, its influence on the crypto ecosystem remains strong. The recovery of Bitcoin and BNB following his tweet illustrates this influence. Now Binance must succeed in convincing regulators, maintaining investor confidence, and better managing the fallout from ongoing legal cases.
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A graduate of Sciences Po Toulouse and holder of the blockchain consultant certification issued by Alyra, I joined the Cointribune adventure in 2019. Convinced of the potential of blockchain to transform many sectors of the economy, I made a commitment to raise awareness and inform the general public about this ever-evolving ecosystem. My goal is to enable everyone to better understand blockchain and take advantage of the opportunities it offers. Every day I try to provide an objective analysis of current events, decipher market trends, convey the latest technological innovations and put into perspective the economic and social problems of this ongoing revolution.
DISCLAIMER OF LIABILITY
The comments and opinions expressed in this article are solely those of the author and should not be considered investment advice. Before making any investment decision, do your own research.